USD/CAD has come under steady downside pressure since failing near the 50% retracement of the March/April decline last month

Our near-term trend bias is lower in Funds while below 1.1030

The 78.6% retracement of the late April advance near 1.0900 is interim support ahead of a key downside pivot at 1.0855

A minor cycle turn window is seen around the end of the week

A daily close over 1.1030 would turn us positive on USD/CAD

USD/CAD Strategy: Like the short side while below 1.1030.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

USD/CAD

*1.0855

1.0900

1.0925

1.0960

*1.1030

Focus Chart of the Day: EUR/USD

The next couple of days look critical for EUR/USD from a time cycle perspective. Since October of last year the uptrend in the Euro has been capped by a key Fibonacci confluence between 1.3835 and 1.3970 (50% retracement 2008/2010 decline, 61.8% retracement 2011/2012 decline & 127% extension of 1Q13 decline among others). With the Euro testing the top end of this zone today it is “do or die” for the single currency into this turn window. Another failure near 1.3970 would set up a potentially very important top while a daily close over 1.3970 paves the way for a push towards the next big confluence zone near 1.4350. A top is favored.

--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

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